In this question I asked at what temperature a foundation becomes unusable for rebuilding purposes. The answer was a fairly low 570°F (~299°C). A house fire that burns a structure to the ground would probably raise the temperature of the foundation at least that high in enough areas to render that portion unusable. I'd think house fires that get that hot are rare, though possibly a bit more likely depending on the environment in which the house is located (e.g. rural, out in the boonies). Adding foundation replacement to one's insurance would certainly raise the cost of said insurance. On the other hand, should a house be destroyed in such a manner and you didn't factor in foundation replacement, there could be a significant out-of-pocket cost to rebuild. So, should we include foundation replacement in our insurance policy's rebuilding estimate?
If the community feels this is off-topic, I'll gladly delete it. It really doesn't have anything to do with DIY.
2 Answers
Good question. Lots to consider.
In most jurisdictions you will not be able to build back EXACTLY what was destroyed, unless it’s less than 25% of the value of the house. (See ICC Chapter 26.) If the loss is greater than 25%, you’ll need to consider upgrading to meet current Code and Zoning standards, including: 1) Structural, 2) Energy, 3) Height restrictions, 4) Lot coverage, 5) Setbacks,
1) New codes have been adopted to meet new wind and seismic requirements. Older foundation systems will not meet these requirements.
2) In order to comply with current energy requirements, the foundation may need to upgraded to provide adequate vents for crawl spaces, in-ground insulation for slabs-on-grade, etc.
3) If the height of the house needs to be reduced, the “footprint” may need to get larger.
4) If the house is too large for the lot, the house’s “footprint” may need to be reduced and the height increased (another floor added).
5) New zoning ordinances in your area may require larger setbacks.
Be careful that your policy covers “removal” costs too...not just the cost to build new back.
Your insurance coverage should be sufficient to cover whatever loss you are expecting it to cover. If you carry homeowners insurance in case of fire, then it probably makes sense to ensure that the limits are high enough to replace the foundation and everything on it. If you carry homeowners insurance solely for liability reasons, it doesn't really matter what the property coverage is (you presumably have other ways to pay those rebuilding costs if needed).
When I lived in Houston, I carried flood insurance on my house. It was a 2 story house in a 1000-year flood plain, so I felt comfortable with a lower coverage amount for the flood policy, as I was only intending the flood policy to cover repair / replacement of structures and property on the first floor - if my second story was flooding there would be far bigger issues to worry about than my house! This allowed me to save a bit on the premiums. My regular homeowners insurance, though, provided coverage for a full rebuild and personal property.
